- Ireland’s tourism and hospitality sector faces mounting pressure from high input costs
- ITIC chief executive Eoghan O’Mara Walsh warned costs will feed through to higher visitor prices
- 2026 visitor numbers held steady with North American market performing well
- Ireland has Europe’s highest energy costs, nearly 50pc above the EU average
- The sector is short around 15,000 bedrooms for growth
Ireland’s tourism and hospitality sector has faced mounting pressure from high input costs that will feed through to higher prices for visitors according to the Irish Tourism Industry Confederation. In a piece published on 9 November, Eoghan O’Mara Walsh noted relief that 2026 visitor numbers held steady and the North American market performed well despite the Iran conflict and energy shock. He warned that the ending of airline fuel hedging, Aer Lingus capacity cuts of 6pc for next year and Ryanair’s prediction of record European airfare rises risk dampening demand.
Ireland has Europe’s highest energy costs at nearly 50pc above the EU average, plus high minimum wages, insurance and other expenses. The sector is short around 15,000 bedrooms for growth and faces tighter short-term rental rules. The ITIC reported overall overseas visitor volume grew with a 13pc year-on-year increase in the first seven months of 2026, although real tourism expenditure failed to surpass 2024 levels.
North American demand remained robust with US visitors up 4pc and Canadians up 8pc. European markets softened with British visitor numbers dropping 4pc, German numbers down 8pc and French arrivals falling 13pc. Domestic holiday trips within Ireland dipped 6pc. The government missed a chance to cut VAT for some attractions in the budget, while the Ryder Cup in 2027 offers a boost.
Eoghan O’Mara Walsh shared “Ireland’s position as an expensive destination means skyrocketing utility, payroll and supply costs are directly squeezing profit margins. These rising overheads will inevitably force their way into the retail prices of hotel rooms, meals and drinks.”
